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A Dearth of News

April 4, 2011 – 5:47 pm

This is going to be a week with little new economic data as we wait for the earnings season to officially kick off. Alcoa is the traditionally the company that starts the earnings season simply because it is a large industrial company that gives us a glimpse of the fundamental economy and they do not report until next Monday. So we have a week where we have few earnings reports but nothing significant and only a few reports on the economy.

We are going to have to wait. I hate waiting. The market will trade based on headline news items and that means whatever comes out of the Middle East and its effect on oil prices, Europe with its continued financial issues and to a lesser extent on Japan with its cleanup efforts especially the nuclear power plant. These three news items are getting old and most of the reaction to them by the market is already built into the stock prices therefore something new and important will have to happen to cause market disruption.

For these reasons think we will see very little this week in the form of market movement but no one can predict short term moves. Corporate earnings and cash levels are very high. Long term that is good for stock prices and the earnings season is going to add to those high levels.

Good Trading
Steve Peasley

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